Uninsured Americans: Fact, Fiction, and Misleading Truths

...

Quote of the Day: Figures don’t lie, but liars can figure.

The following is an excerpt from Downsizer – Dispatch, the official email list of DownsizeDC.org, Inc. & Downsize DC Foundation.

Many people have asked: “What about people with no health insurance?” Or, “How many people die in America because they lack coverage?”

These are good questions. They were two of my main questions when I started researching this issue.

The most commonly heard estimate for the number of Americans without health insurance is 45 million. That’s a whopping, scary number. Alas, it is also highly misleading. John Stossel of ABC News has used research by the U.S. Census Bureau to expose the deeper truth behind this scary number. It turns out that . . .

  • 37% of the un-insured live in households earning more than $50,000 a year (and 19% live in households earning more than $75,000). Can people at these income levels afford major medical insurance? Yes. Should they be subsidized by you and me? No. Subtract this group and the number of uninsured people drops to roughly 28 million.
  • 20% of the un-insured are non-citizens. Should you and I pay to insure them through a top-down federal monopoly? We think not. Subtract this group and the number of un-insured people drops to roughly 19 million.
  • 33% of the un-insured are already eligible for existing government programs. No new program is needed for people who are already covered by current programs. Subtract them and the number of uninsured people drops to roughly 4 million. This is much more likely to be the true size of the problem.

45 million vs. 4 million — that’s a huge difference! Now here’s the kicker . . .

The Congressional Budget Office estimates that a standard health insurance deduction would make it financially possible for 7 million additional people to buy coverage. And another study by the Treasury Department arrives at a similar estimate. Thus . . .

Congress could wipe out the un-insurance problem in one swoop — not by creating a new program, not by spending more money, and not by monopolizing American health care, but simply by letting people keep more of their own money to spend on health insurance.

Moreover, as we understand it, the proposed health insurance deduction could be structured to apply to payroll and Medicare taxes too, which are regressive taxes that hurt low income Americans far more than income taxes do.

Best of all, a standard health insurance deduction wouldn’t just help those with lower incomes, it would help everyone who has to purchase their own insurance.

Now, what about the number of Americans who die because they have no health insurance? As far as we can tell that number is effectively very small, and almost certainly nothing like the 18,000 deaths that Michael Moore claims in “Sicko.” Here’s why . . .

Hospitals are legally required to provide treatment, regardless of ability to pay. Most doctors will also provide routine medical care to the indigent, because this is part of the medical ethos.

In fact, these are two of the main ways low-income non-citizens without insurance get treatment, in addition to the already existing programs at the local, state, and, alas, federal level.

This is not to say that some people don’t fall through the cracks, because of incompetence, or for other random reasons. They do. Perfection is not an option in this imperfect world. It is simply to say that our current system has no fundamental systemic flaw leading to widespread death such as we see with health care rationing in the socialist systems.

We could simply leave it at this and say case closed. Congress could solve the problem of the un-insured with one simple change. No federal health care monopoly is needed. In fact, we have shown that government health care monopolies in other countries have led to unneeded deaths through rationing and waiting lists. So . . .

These facts should be enough for everyone to oppose any further funding of personal health care expenses at the federal level.

But we aren’t done yet.

Our current system would still have problems, even if Congress closes the insurance gap by creating a standard health insurance deduction. After all, the horror stories Michael Moore tells in “Sicko” are true, and similar things would continue to happen far too often, even if we closed the insurance gap.

We can change the debate by forwarding these messages far and wide, and by pounding Congress, to penetrate their myth-shrouded echo chamber.

  • We must let Congress know that we know the truth.
  • We must tell them that we expect them to know and speak the truth too, and act on it, to improve our health care rather than make it worse.

Achieving these goals is up to you. We provide the tools to do it, but you must use them. Please do two things . . .

  1. Forward this message to others.
  2. Send Congress a message opposing further federal funding of personal health care expenses. In your personal comments you can cut and paste the above statistics to let Congress know that you know what the truth is, and that you know they have the power to make things better simply by letting people keep more of their own money. Send your message here.

Perry Willis
Communications Director
DownsizeDC.org, Inc.

7 thoughts on “Uninsured Americans: Fact, Fiction, and Misleading Truths

  1. Great find on the story above. It is scary that the top three democratic candidates are proposing a national health care system. While it is good on the surface, fact is a system of that size would not be efficient, cost tax payers billions, and provide worse care. There are better ways to solve the problem and hopefully voters will not be fooled into the sympathy argument. For the supporters of national health care, I dare you to ask anyone currently working in government health care now, how the system works. You will find it is laced with politics, fraud, and overspending. It will not work on a large scale.

  2. bc, I agree entirely.

    Why don’t we just open Medicare/Medicaid to all the uninsured? We force all of our Senior Citizens into it (whether or not they want it versus private health insurance), so why not force everyone else into it?

    http://www.JoeLevi.com

  3. I have generally supported the idea that the free market place is the ultimate leveling field most every industry, and should be left as much alone as possible. But the egregious lack of ethics by insurance companies and the capitalistic nature of the health care system that is raping our American public has given me pause, and I am changing my tune. There are bright people that vehemently object to universal health care, but I challenge them to stop debating with pointed and well formed arguments that can be done for/against any and take a second look at our system with the idea we might have it wrong at its root. Take a long pause and think “What if it were me …” that had had an accident, or got sick, and was denied coverage or was in between coverage. What if you were going bankrupt and about to die. Life is tough you think, but actually, it was simply because you were American.
    Until very recently I was ignorant of the fact that everywhere else in the world people truly just don’t worry about what is going to happen with their finances if they get real sick. Everywhere else, even the poor still get treated for diseases that upper middle class people in our country go bankrupt and eventually die for. When I say everywhere else, what do I mean? I mean everywhere except a few developing and third world countries. These countries all have universal health care: Argentina, Australia, Austria, Belgium, Bosnia, Brazil, Brunei, Bulgaria, Canada, Chile, Costa, Croatia, Cuba, Czech, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, India, Ireland, Israel, Italy, Japan, Kuwait, Lichtenstein, Luxembourg, Malaysia, Malta, Netherlands, New Zealand, Norway, Poland, Portugal, Qatar, Republic, Rica, Romania, Russia, Saudi Arabia, Serbia, Seychelles, Slovakia, Slovenia, South Korea, Spain, Sri Lanka, Sweden, Switzerland, Taiwan, Thailand, UAE, United Kingdom, and Uruguay. The US is the ONLY developed “wealthy” nation that doesn’t.
    I don’t think anyone is denying that the US health care system uses profit as its compass; that most hospitals, most insurance companies, and for most people, the discussion of cost is at the forefront of decisions made with respect to health care. Without rattling off statistics that each side would want to declare as too high or too low, can’t we agree that the majority of doctors, nurses, and other health professionals HATE dealing with the insurance companies? Is any informed ethical person really arguing that insurance companies aren’t regularly denying care that should be administered, for the sake of profit? Isn’t it telling that this was Mr. Incredible’s job, and we thought it was funny – not tragic? If our system allows even insured people to bankrupt themselves and die with an illness that any other developed country would have been treated at no cost, can we agree that those arguing what percentage doesn’t have care is stupid? Can we agree that treatment and recovery is at least as good as (if not a hell of a lot better) than not treatment and death, so arguing the quality of care in countries with universal care is misses a major point?
    Suppose in a small town in southern Mississippi we learn that the fire houses are private companies and when a house catches fire, the first thing the firemen ask is if the person had insurance that covered their visit. If so, they put the fire out as best they could. If not, they asked either for cash for the estimated cost of putting out the fire, or they let it burn. Would we not be outraged and demand change? Why are we afraid of socializing a basic social need? If we were to use the same analogy for policing, wouldn’t our current system sound a lot like the mafia?
    I ask you to demand change from our legislators. Americans deserve better than last place.

  4. @Scott,

    Good commentary, though I disagree with your conclusions. (Isn’t our country great? We can both have polar opposite opinions, yet we both regard each other with respect. Thanks for not flaming! :)) By the way, your site is pretty cool! 🙂

    I agree with you about most insurance companies (HMO, PPO, etc.) and their lack of ethics. I would also add that they lack efficiency. Large organizations require large overhead to operate. Overhead is expensive (infrastructure, communications, buildings, employees, etc.). Sending out statements and notices (sometimes 3 and 4 at a time, in separate envelopes no less) is also expensive — not to mention wasteful.

    Private doctors now have to hire or contract with an office staff to obtain insurance information, and appropriately bill the patient’s insurance policy. Which bring up another point: insurance companies traditionally operate as a 3rd party payer. In other words, a patient doesn’t care about the cost, they only worry about their co-pay.

    Ironically, today’s co-pay alone would have just about covered the entire cost of the doctor visit when I was a kid. Even with a $15 co-pay, I’d gladly pay twice or even three times that to a doctor if I didn’t have to pay any insurance out of my pay check.

    Look at where the money is going: a good portion of the doctor’s pay is going to cover additional staff needed to properly bill the insurance companies; another large part is going to cover his malpractice (or “liability” insurance) because we’re so “sue-happy.” Another good portion of the money is going to cover the MASSIVE overhead behind health insurance companies.

    Get rid of both of those and we have health services that are not constrained to what the insurance company dictates, rather by what the doctor thinks is best for you. And it costs less, too!

    How could we make our present system worse? By having the government step in and handle it. Medicare, MedicAide, VA Hospitals… need I say more? Yes, All of these programs serve a purpose, and do help some people, but they’re all examples in inefficiency and poor-service.

    So, let’s take you fictional private fire-fighting service (which actually took place not terribly long ago) and apply our logic (above):

    Let’s say my house catches fire. It’s a small fire, nothing to worry about. I could have smothered it by simply placing a lid over the top of the frying pen, but I didn’t. Instead I called my local fire-house: they two minutes down the road. I’ve toured their facilities: state of the art. The Customer Service Representative asks me if they are an “in-network provider” or not — I don’t know whether they are or not. They recommend that I call the number on the back of my fire insurance card and make sure, otherwise the cost of fighting the fire might be prohibitive.

    I went to my wallet and dug out my “fire insurance” card and dialed the toll-free number on the card (which costs the insurance company more than it would have cost me for a long-distance call, but that’s just one more example of inefficiency). I’m asked a series of questions to which I can press or say a number, which leads me to another series of questions.

    Finally I’m put in the call queue that can “most appropriately” answer my question. By this time the fire has caught the cabinetry on fire — a simple “lid on the pan” won’t put it out any more. Luckily I still have a fire extinguisher nearby.

    After being on hold for 15 minutes (and forced to listen to some awful music because the RIAA won’t let companies play “decent music” without paying through the nose for it) the fire has engulfed the cabinets and is climbing the walls. It’s getting hot in here, but I don’t want to hang up the phone and call from a neighbor’s house because I’ll lose my place in line.

    Finally I get through to a “customer service representative” who is outsourced by a company in India. I can barely understand him/her, but I recognize this is helping keep the cost of my premiums down and is helping the global economy, so I struggle through what should have been a 60 second conversation in 5 minutes.

    During that time I’ve managed to communicate my name, my membership number, my place of employment, my group and policy numbers, and have given a $15 co-pay via my credit card (a receipt will be emailed to me — unfortunately the computer is now on fire, too).

    The kitchen and office are now entirely aflame. I switch to the phone in the den and yell for one of my children to “go hang up the phone in the kitchen.” Luckily, after braving the fire, my child returns with just minor smoke-inhalation.

    The Indian Customer Service Representative has me on hold while he/she checks my account and finds an “in-network provider.” Five minutes later I’m told that the fire station down the street isn’t on the preferred list, so if I utilize them I’ll have to pay 80% of the cost, but the fire insurance company will pay the other 20% (up to $5,000, after that it’s up to me). The closest “preferred provider” is 20 minutes up the road, but the fire insurance company will pay 90% up to $5,000, then cover the rest at 100%; I’ll still have to pay the co-pay and 10% of the costs (up to $5,000). I go ahead and agree. The “CSR” gives me an authorization number and the phone number of the fire station and asks if I’d mind responding to a short quality survey regarding the call and level of service. I decline — the fire is spreading. The CSR asks if it would be okay if they people from the survey call me at a later time; I comply. When would be a good time for them to call back? Oh, how about after the fire is put out! When will that be? Well, the sooner I hang up and get the fire station called… I hang up abruptly and call the “preferred fire station.”

    Luckily my call is answered quickly and a fire response team is dispatched to my location. Luckily it’s only 20 minutes away. I grab my kids and wife and we run across the street to the neighbor’s lawn.

    45 minutes later a lone fire truck arrives, it’s got a reel and a garden hose on top. They say the “big hose truck” is on another call, but will be here shortly, in the meantime the trickle of water from the “little hose truck” starts spraying the fire.

    An hour later half of the house is ablaze, but the “big hose truck” finally shows up. It takes another hour to get the blaze under control.

    The house didn’t quite burn to the ground, the garage is still in-tact.

    About a week later (my family and I are living in the garage now), we get the bill from the “preferred provider.” We owe $500 that the fire insurance company didn’t cover (our 10%). Oh, and our fire insurance premium is now 7 times what it was before, but they’ll start taking that out of my next pay check, so all is well.

    The moral is this: with a little bit of education and a sense of self-reliance I should have know that all I had to do was put a lid on the pan and the fire would have been smothered. Instead I had been taught in public school, by my employer, the health insurance “machine”, and my government that I shouldn’t do anything for myself, that there is someone out there to do it for me. And if there isn’t, there should be. I just need to pay more money out of my paycheck to some large insurance company, or to the government, or both, and they’ll take care of me.

    Here’s where I get to pick on the tenets of our religions (I noticed that you’re Catholic, and I’m another form of Christian)…

    We are taught to love our neighbors and to take care of our selves and our families. Doing so are Christ-Like attributes and we’re supposed to emulate Him. Right?

    So why wouldn’t I have educated myself, and taught my children of worldly things (in addition to spiritual things)? If I had, then I’d have known (and my family would have known) how to put the fire out before it became a problem. And even if it did blaze out of control, wouldn’t I have been a good enough neighbor that they would have chipped in and helped me fight the fire before it did any major damage? And even if the house did burn to the ground wouldn’t they have invited us into their homes to give us warmth and food until we could re-build my house?

    That would have cost the government nothing. It would have cost me no co-pays, and no premiums out of my pay check… I’d be a lot richer, wouldn’t I? But what would I do with all that extra money? Hopefully, being the good Christian and good neighbor that I’m trying to be, I’d see how my neighbors are in need and I’d be able to help them out because I’d have the means where they may not because of their circumstances.

    But the way it is now, we live in a country (and pretty much a world) where it’s a liability when we try to be a good Samaritan, a good neighbor, and being a Christian is under attack by the media and the legal system.

    A government program isn’t going to help. Being a good neighbor — a good Christian is the real answer. And why limit it to Christians, doesn’t the Koran teach tolerance and good-will as well? Don’t most religions teach this as well?

    Anyhow, just my thoughts… though I am appreciative of yours as well!

    http://www.JoeLevi.com

  5. Thank you for your reply to my thoughts. And yes, I think it is great that we can discuss our differences on an issue amicably. I do not think this fact is unique to Americans though. There are very few developed nations that do not foster the same basic human rights we do, and in fact to many, e.g. Norway, Sweden, Switzerland, etc., our standards are quite low.

    I think it is ironic that you developed such a fantastic story about how horrible the fire stations would be if they were government run, when in fact they already are and run quite well basically free to all. I understand the fear. But I believe that fear is directly the result of half baked attempts. Our fire safety is outright free. There is no normal situation that you think about money in regards to calling the fire department. The story is not a relevant analogy to the system like Norway or England. They NEVER get a bill. You just walk in with a medical need, get treated, and leave. You don’t even think about the cost, much like calling the fire department. You have a need, you go/they come. Same thing.

    Suppose a Midwestern city had corrupt civil leaders and as a result their roads were deplorable. Suppose every few springs the officials promised reparations with widespread construction but what they did was patching and mismatched half baked improvements. During the construction traffic naturally was worse, but it seemed like for no benefit for when they were done, the citizens swore the roads were in worse shape than before. At first, citizens might demand improvement/change. But suppose the worsening of the roads seemed inevitable, happening again and again for years. Most citizens would eventually prefer them to not mess with the roads at all.

    Obviously it is not impossible to have good decent roads, they exist all over the world. But the citizens can’t really expect positive change by small changes. They have to oust the existing governing body and bring advisors from other cities to regenerate a whole new way of doing it right. If they were to smart, they could pick advisors from cities with not just acceptable roads, but rather the very best roads. That city could, in a few years, have the best roads of any city, if they so chose. If they were smart, that is. But they’d have to eat a little humble pie and recognize they really didn’t know what was best, and ditch their current ways. It is not something that you can pick and choose; you have to go whole hog.

    Actually, your analogy of the fire department is rather close to our current state, if all we do is band aid it and make subtle changes like add government subsidized health insurance for those not covered; yes it would get worse, I agree, and I think it is absolutely deplorable how bad it is now. I don’t think I am in favor of any of the universal health care bills that have been suggested so far (until recently was was categorically against them you see), but only because they don’t go far enough. No question what I suggest has a high tax cost associated with it, which I am generally not in favor of, but I think the overall dollar in our pocket would go up. I am self employed and pay my own premiums. I pay $1k a month just for health insurance, not counting my deductibles, etc. That’s like a flat 15% tax rate on my gross, and 25% on my net. Of course, our tax system doesn’t actually tax your final rate on the first series of brackets, so it is much worse than it sounds. I actually pay more on health, than I do in taxes, a lot more. I bet most people do to, if you count what their employer spends – it money not given to them. We can’t fix this serious problem with small or even moderate changes. We need to scrap the existing system, all together. NO health insurance companies, period. None. There is no room for them in an ethical society. Corporations are by law mandated to maximize profits. I want that kind of mandate no where near something like “Do you really need an MRI?” I have never not been covered and this kind of value based second guessing doctors is 100% the reason my right knee is permanently screwed up (another long story) Would scrapping our system displace a lot of people? Yes, their careers are based on a flawed system and the meaning of their job is truly useless to our society. Start over. Consider it going from a four lanes highway to two while fix the road to a real 10 lane superhighway.

    I say implementing universal health would be a good time to fix the IRS too. I think we should abolish income tax up for everyone up to 10x the national average income, and go to a flat 20% sales tax on everything except gas & food, and specific needs of the common man (specific items deemed tax exempt, like school books, basic clothing –not designer- paper, computers, etc.) Basically, if you are poor, you should pay tax on very little that you buy, unless you decide a big screen is what you really want. Then, you pay the same tax as anyone else (on that tv). For those who make millions, paying 20% on the income above 10x the national average will add up to less than what they pay now. Suppose the average was 40k, a person who makes $500k would pay $20k in taxes. Not bad; they certainly can afford that. If you made $350k, you’d pay nothing. Just because you do well, doesn’t mean you are rich and the flat tax ensures you still pay your share. If you made $2M, you’d pay roughly $400k. There’d be no estate tax, no inheritance taxes, and no loopholes. No deductions for homes or anything else. Americans could save money without a penalty on doing so. I hate that even If I don’t spend a dime, I have to pay a huge tax on my income. I feel it is wrong. Where as flat sales tax affects everyone who shops or play here too. They are using our roads, and enjoying the freedom our military provides. The US is a HUGE playground for Europe and Asia. Those people should pay the same tax we do when they spend their money here.

    Here is huge money saver: phase out Social Security. It has to go anyway – no way we can afford it when I am 70. So let’s start an alternative plan that will work indefinitely. It only works, of course if there are a few very important social programs in place: 1 free health care. 2 free nursing homes. Basically if it is a universal need that everyone is going to need, it should be provided for by the state and paid for with taxes. But if you do well, can save every dollar you earn, and don’t go bankrupt paying medical bills, likely it will be a lot easier to pay for that retirement yourself.

    I have to go home, but it’s been fun ranting a little bit. I look forward to your response.

    Scott Peach

  6. @Scott,

    We’re basically talking on the same lines… and we have surprisingly similar conclusions.

    Regarding my fire insurance story, you’re right, that is the same situation that we’re in with health insurance. It’s not what we’re in with “fire coverage.” Ironically, my dad just had a case where a neighbor called the fire department regarding his wood fireplace, the fire station came and “put out” a chimney fire (that didn’t really happen, as we came to find out), and sent my dad a bill for their services. So even fire protection isn’t “free” anymore.

    Back on-topic… I’m right there with you regarding income tax, estate tax, marriage tax, and most other kind of tax out there.

    Get rid of all Federal taxes. Get rid of the IRS. Institute a flat 20% sales tax on everything. I’d go as far as taxing food, shelter, gasoline, electricity, natural gas, etc., but only at 20% (or whatever that “magic number” turns out to be).

    The only thing “exempt” from sales taxes would be food staples (wheat, flower, oats, milk, eggs, vegetable oil, corn, seeds, and fresh produce). If you want a cake and want it tax-free, you make it from scratch.

    Also, property would be taxed at sale (or re-sale) but never outside the context of a sale.

    You’d pay your sales taxes to the local city/municipality in which you do business, who would then support the county, who would then support the state, who would then support the federal government. The money would all “roll up” like it did under the original intent of the Founding Fathers. This would encourage fiscal responsibility at the most local of levels, where we (The People) have the most control.

    Social Security would be phased out (just like your plan). What people have paid in they will get back, plus whatever the prime interest rate is, but existing contributors will have the option to put it into a 401(k) style account, new contributors won’t have the option (it’ll just go into the 401(k))).

    Medicare and MedicAide will undergo the same transition, with the money normally paid out going into the 401(k) style account. (Of course the 401(k)-style account would allow payouts for emergency services.)

    But my take-home message would be more self-sufficiency, more “good neighborliness,” smaller government, and more involvement at the local level.

    Have a fabulous night, and thanks for the stimulating conversation! Hopefully I see you back in the not too distant future.

    http://www.JoeLevi.com

Leave a Reply